Incentive Doesn’t Work, Logistics Companies’ Toughness Will Stay No Longer: ALFI Survey

There is evidence to say that the corona virus (covid-19) outbreak has negatively impacted any kind of businesses in Indonesia, including the logistics sector. Many business players have suffered business loss, many are threatened with bankruptcy.

Unfortunately, incentives as the government has promised to help the sector has not been realized yet. Majority of logistics business admitted that they have not accepted the incentives like stimulus or credit facilities from the bank yet, no extension of grace period nor reduction of interest rate from the bank.

The survey of Indonesia Logistics and Forwarders’ Association (ALFI/ILFA) released today, Thursday, September 24, explained that 77.7% of the respondents admitted that they have not been benefitted with the incentives yet. They never accepted the credit facilities nor relaxation yet. Meanwhile, 9.2% of the respondents admitted that they have become the beneficiaries of the incentives of credit facilities and relaxation. The remained respondents admitted that the incentives of interest rate reduction were still in the process.

ALFI has conducted a survey on the impact of the pandemic to the logistics sectors that involved as many as 1,256 respondents. The survey took place for one month from early August.

Most of the respondents are ALFI members. In total, ALFI members reached 3,412 companies spreading throughout 34 provinces nationwide. Of the total, as many as 291 companies are PMA (joint venture with foreign).

Threatened with Bankruptcy

The survey also explicates the level of toughness of the logistics companies if the pandemic will not end soon, saying it very various.

Around 12.6% of the respondents say that they will be able to survive for the next three months, 35.4% for the next three to six months and, 51.9% of the respondent say they are able to survive for six to 12 months.

Around 95.6% of the respondents say that their business income decreased due to the pandemic, while only 4.4% say that their income was steady and increasing.

Fortunately, the survey concludes that there was no massive labor lay-off  (PHK) in the logistics sector until now.

ALFI Chairman Yukki Nugrahawan Hanafi affirmed there were some logistics sub-sectors that seriously hit by this pandemic, while some were still stable, even grew up, during the pandemic. Yukki said the logistics running services in the commodities of electronic, automotive, and textile had been seriously hit by this pandemic. Those that were stable and even grew up include e-commerce logistics, courier service, warehousing for basic commodities and retail, and logistics services of business to consumer (B to C) and consumer to consumer (C to C) transactions.

Yukki affirmed that the PSBB (large-scale social distancing) policy at some provinces have significantly affected the logistics business. Since the PSBB stops the operation of some industries and manufacturing activities, the process of raw material import and the export activities also stop.

Yukki said this automatically disturbed the logistics activities. “Though there are some exemptions, but no doubt, this has affected the logistics activities, the ones that support the industry activities in particular,” he said.

The ALFI survey also proves it. According to the survey, around 52.9% of the respondents affirmed that they faced obstacles in operation during the pandemic, while 47.1% of the respondents admitted of facing no obstacles.

They got the obstacles from some process, including 41.5% from the sea port and air port process, 21.1% from land roads, and 37.4% relates to permit and additional cost.

Yukki said that ALFI will recommend the result of the survey to the government’s related institutions, expecting it to be reference for the government in making some policies, especially policies relating fiscal, monetary, trade, and industry.

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